EPA air pollution rules for oil and gas industry delayed - Business, Government Legal News from throughout WV

EPA air pollution rules for oil and gas industry delayed

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Air pollution rules for the oil and gas industry expected from the U.S. Environmental Protection Agency have been delayed by another two weeks, from April 3 to April 17.

"We're disappointed that EPA hasn't gotten their act together because these rules are long overdue and the controls are desperately needed," said Robin Cooley, staff attorney at the public interest law firm Earthjustice, during an April 2 conference call organized by environmental groups to discuss the forthcoming rules. "But at the end of the day, what we want is a good strong rule."

The EPA rules come as the result of a lawsuit filed against the agency in 2009 by WildEarth Guardians and San Juan Citizens Alliance, represented by Earthjustice. The suit alleged that the agency had failed to review the New Source Performance Standards and Air Toxic Standards for the oil and natural gas industry as mandated by the Clean Air Act.

A February 2010 consent decree established a schedule on which the agency would have to released proposed and final rules; this is the third extension of the final-rules deadline.

The proposed rule

When the EPA issued its proposed standards in July 2011, it estimated that the standards would reduce smog-forming volatile organic compound, or VOC, emissions by 25 percent, air toxics by 30 percent and, as a side benefit to the control of those emissions, methane emissions by 26 percent.

The regulations would apply to more than 1 million producing oil and gas wells, the agency said, as well as 600 processing plants, 3,000 gas transmission compression stations and 1.5 million miles of gas pipelines.

The target of the rules is VOCs and air toxics, which can cause, among other human health effects, respiratory illness and cancer.

But in using existing technologies to control those emissions, the agency noted, the industry also would control emissions of the potent greenhouse gas methane. The oil and gas industry accounts for 40 percent of U.S. methane emissions.

Green well completion

"Green well completion" captures the large slug of emissions that escapes when a well is hydraulically fractured, or fracked, including a significant amount of methane — the component of raw natural gas that is marketed to consumers as "natural gas" — that can be sold, quickly paying for the control process.

"When a well is newly fracked or refracked, you get a whoosh of pollution, like popping the top on a soda can," explained David Doniger of the nonprofit Natural Resources Defense Council. "Those gases can be captured, contained and ultimately put back in the pipeline to be sold for profit using green completion rigs. Most have payback periods of six months to a year."

Since the EPA's proposed rules came out, several studies have attempted to place a number on the share of a well's methane that escapes. Estimates range from around 2 percent up to nearly 8 percent.

The industry has countered that those estimates are too high — that producers would never put up with that kind of loss of their primary product.

However, Doniger argued, whatever the number is, the industry has found through experience that green well completion ultimately saves money.

If so, why would it be necessary to impose the practice as a regulation?

"There are many examples in American business, all the way down to us as homeowners, where we simply don't do everything in the way of energy efficiency or pollution reduction that actually pays us back," Doniger said.

"Why do we need appliance efficiency standards for refrigerators or dishwashers, when the industry would manufacture products at that level because it would save consumers money?" he asked. "It doesn't happen, because not everybody is good at maximizing their returns and doing everything that makes sense."

Securing gas's greenhouse gas advantage

The urgency to regulate emissions from gas extraction and processing is intensified by the electric power industry's increasing reliance on natural gas, according to Ann Weeks of the nonprofit Clean Air Task Force — a reliance furthered by recently proposed EPA greenhouse gas rules that will make the construction new coal-fired power plants unlikely.

Given that, it's important to secure natural gas's greenhouse gas advantage over coal in the power industry by capturing the escaping methane, Doniger said.

The environmentalists noted that the rule will not address all oil and gas air pollution. Methane emissions are not regulated directly by the rule, for example; nor is the issue of "aggregating" emissions sources that are close together and related for purposes of determining permit limits.

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